Right now, the Bloomberg administration and the real estate industry are trying to get the City Council to approve the rezoning of Midtown East to allow taller, more modern skyscrapers to replace the district's aging office stock.

In order to take advantage of the new air rights created by the upzoning, landlords would have to pay $250 a square foot into a fund that will be used to underwrite improvements to the public space in the 73-block swath of Midtown.

Some transportation advocates and urban planning types argue the city is undervaluing those air rights. Midtown Trackage, which owns the existing more than one million square feet of development rights over Grand Central, agrees.

"Specifically, the Proposal would substantially diminish the value of development rights—our client’s property rights—by allowing developers to essentially purchase the equivalent development rights from the City either in the form of district improvement bonuses (“DIBs”) or “in kind” infrastructure improvements at $250/sq. foot, a level substantially below the market rate," wrote Bowman in his testimony before a City Council committee earlier this week.

"The City’s Proposal thus would force our client to bear the cost of incentivizing development," he continued. "The United States Supreme Court has stated that requiring one citizen to bear the cost of a public improvement that in all fairness should be borne by the public at large is the quintessential wrong prohibited by the Takings Clause. We respectfully urge the City Council not to pass this unconstitutional proposal, and to take the time to develop a new proposal that can both meet the Council’s public policy goals and pass muster in the courts"

It's probably also worth pointing out without the rezoning, which would allow for the transfer of air rights within the district, not merely to contiguous properties, Midtown Trackage's air rights would be a lot less useable, and therefore a lot less valuable.

The city's planning department had no immediate comment.

UPDATE: In a statement a planning department spokeswoman said, "We have confidence in the work of the independent expert appraiser retained to conduct the study and believe that the proposal is lawful in all respects."